The growing popularity of electronic commerce over the Internet is a modern phenomena. Retail e-commerce is far more convenient than bricks and mortar shopping, but one of its drawbacks is that the customer lacks the ability to inspect the goods. Inherent in Internet purchases may be an increased likelihood of customer returns.
For returns not purchased in an e-commerce environment, a consumer can visit a brick and mortar retail store, which accepts product returns at the retail location. Typically, the store will operate a sales counter or customer service counter specifically for returns. Consumers could expect to immediately receive cash or a credit on the return.
In the conventional returns scenario, the retailer of a returned good will assess the condition of the returned item. Returned goods in new condition can be put back on the shelf for re-sale. Returned goods that were defective or otherwise inappropriate for resale can be collected and stored until enough goods accumulated to justify bulk shipment to some sort of disposition center. At the disposition center, the condition of returned goods are again evaluated and goods were routed to an appropriate destination, such as an outlet store, manufacturer, or land-fill.
This conventional method of handling returns goods is not necessarily the most satisfactory for Internet purchases. In the absence of local brick and mortar retail locations, the goods must be shipped from the consumer back to the internet retailer's location. From there, the costly process of shipping and handling of returned goods back through the retail channel continues.
Returns to catalog retailers have the same complications as returns of Internet purchases. Despite these inefficiencies, internet and catalog retailers (collectively known as direct marketers) are still using conventional product returns methods.